Mark Bole wrote:
- quote -

not include non-dividend distributions. The taxpayer has to make
the calculation to adjust basis for the distribution.

Here is Fidelity's explanation.

Return of capital
A return of capital occurs when a fund's distributions exceed its
earnings in a fiscal year. Distributions are not taxable when
they exceed earnings, and are reported on Form 1099-DIV. The
total basis of the position is reduced by the amount of the
non-taxable distributions, but they do not affect the basis per
share of existing shares.

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As a convenience, some brokers provide an average-cost basis calculation
result for mutual fund shares sold.

If there was also a non-dividend distribution during the year (reduces
basis on remaining shares), is it common for the broker to take that
into account for the year-end calculation? Or would the basis number
calculated by the brokerage be further reduced by the non-dividend
distribution (1099-DIV box 3) allocated by number of shares owned at the
time of distribution?

-Mark Bole

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >